The Nigerian Communications Commission (NCC) will this week publicly announce the names of 18 banks that failed to clear their N200bn debt owed to Mobile Network Operators (MNOs) for Unstructured Supplementary Service Data (USSD) services. The telecom regulator is poised to take action, including suspending services for defaulters.
Impeccable sources revealed that only four banks have adhered to the payment directive jointly issued by the Central Bank of Nigeria (CBN) and the NCC in December 2023. This directive required settling 60% of pre-API invoices by January 2, 2025, and agreeing to payment plans with MNOs. However, the remaining banks have yet to comply.
NCC Set to Suspend USSD Services Amid Debt Concerns
Pre-API invoices refer to unpaid USSD charges before implementing Application Programming Interfaces (APIs) in February 2022. These older systems led to billing disputes between banks and telcos. The NCC is preparing to suspend services within two weeks if banks do not pay, potentially disrupting banking transactions for millions of Nigerians relying on USSD.
The NCC’s upcoming public statement will guide subscribers on how to switch banks to maintain uninterrupted access to banking services.
Why the NCC’s Decision is Crucial for the USSD Ecosystem
Telecom operators argue that unpaid debts threaten the sustainability of USSD services. Banks, however, have been slow to prioritize these payments despite the critical role of USSD in the Nigerian economy. In the first half of 2024 alone, USSD transactions totaled N2.19tn across 252.06 million transactions, highlighting the growing reliance on this service.
The adoption of APIs has improved transaction efficiency, yet legacy debt remains a significant hurdle.
Tier-One Banks Still Owe the Bulk of the Debt, NCC to Act
The Chairman of the Association of Licensed Telecom Operators of Nigeria, Gbenga Adebayo, confirmed that smaller banks have begun settling their debts. However, tier-one banks, which owe the majority, have made minimal payments.
Adebayo stressed that the intervention of regulators, including the NCC and CBN, is necessary to resolve this prolonged issue.
Economic Implications of NCC’s Action on USSD Services
USSD services, originally developed by telecom companies for airtime and subscription management, are now indispensable in the banking sector, especially for users without internet access. NCC’s decision to enforce payment and potentially suspend services could disrupt the banking ecosystem if unresolved.
Experts like Ejike Onyeaso have reiterated that banks must compensate telecom companies adequately, as USSD generates significant revenue for financial institutions.
